By Duncan                                              S.B. No. 449
         77R5049 JSA-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the creation and administration of the research
 1-3     university fund and to eliminating the transfers to the higher
 1-4     education fund.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  Subtitle H, Title 3, Education Code, is amended
 1-7     by adding Chapter 154 to read as follows:
 1-8                    CHAPTER 154. RESEARCH UNIVERSITY FUND
 1-9           Sec. 154.001.  PURPOSE.  The purpose of the research
1-10     university fund is to provide excellence funding to eligible Texas
1-11     public research institutions of higher education to allow Texas to
1-12     remain at the forefront of scientific and technological innovation
1-13     by developing a highly skilled workforce and fostering sustained
1-14     scientific innovation and commercialization of technology.
1-15           Sec. 154.002.  DEFINITIONS.  In this chapter:
1-16                 (1)  "Coordinating board" means the Texas Higher
1-17     Education Coordinating Board.
1-18                 (2)  "Eligible institution" means a general academic
1-19     teaching institution, as that term is defined in Section 61.003,
1-20     that:
1-21                       (A)  is eligible to participate in the funding
1-22     provided by Section 17(a), Article VII, Texas Constitution, and is
1-23     not eligible to participate in funding from the available
1-24     university fund under Section 18, Article VII, Texas Constitution;
 2-1                       (B)  awarded at least 50 doctorate or equivalent
 2-2     degrees in at least two of the preceding four academic years; and
 2-3                       (C)  received at least $15.5 million in federal
 2-4     funds to support research activities of the institution in the most
 2-5     recent academic year for which that information is available to the
 2-6     coordinating board.
 2-7           Sec. 154.003.  RESEARCH UNIVERSITY FUND.  (a)  The research
 2-8     university fund is a fund outside the state treasury in the custody
 2-9     of the comptroller.
2-10           (b)  Each state fiscal year, the legislature may appropriate
2-11     not less than $50 million to the research university fund.
2-12           (c)  The coordinating board shall recommend to the
2-13     legislature a method or formula to allocate the money in the
2-14     research university fund to the eligible institutions.
2-15           (d)  An amount allocated from the research university fund to
2-16     an eligible institution may be used only to further the purposes of
2-17     this chapter.
2-18           (e)  The comptroller shall administer and invest the fund in
2-19     the same manner as the permanent university fund.
2-20           SECTION 2.  Section 62.026(b), Education Code, is amended to
2-21     read as follows:
2-22           (b)  The fund consists of the money [$50 million] deposited
2-23     in the fund [each state fiscal year] under former Section 62.025
2-24     [of this code] and interest, dividends, and other income earned
2-25     from the investment of the fund.
2-26           SECTION 3.  Section 62.025, Education Code, is repealed.
2-27           SECTION 4.  Not later than December 1, 2001, the comptroller
 3-1     and the Texas Higher Education Coordinating Board shall adopt rules
 3-2     necessary to administer Chapter 154, Education Code, as added by
 3-3     this Act.
 3-4           SECTION 5.  This Act takes effect immediately if it receives
 3-5     a vote of two-thirds of all the members elected to each house, as
 3-6     provided by Section 39, Article III, Texas Constitution.  If this
 3-7     Act does not receive the vote necessary for immediate effect, this
 3-8     Act takes effect September 1, 2001.